Why Focus on Equity and Social Impact — the “E” and the “S” of DEI and ESG.
Integrating these commonly siloed efforts—and addressing issues with proven solutions—leads to lasting change and business benefits.
QUICK SUMMARY:
Diversity, Equity, and Inclusion (DEI) and Environment, Social, and Governance (ESG) are complex and evolving fields.
The “E” and the “S” of DEI and ESG — Equity and Social Impact— have proven to be the most difficult elements to measure, gain consensus around, and improve.
They are also the key to meaningful and self-sustaining change for all your DEI and ESG efforts.
They can’t be improved with a solitary program, or in isolation from each other; system-level planning and integrated solutions are needed to avoid recurring problems and unlock benefits.
Complex and evolving. That's the best way to describe the fields of Diversity, Equity, and Inclusion (DEI) and Environment, Social, and Governance (ESG). Having spent more than twenty years in the industry, I've witnessed their growth as business priorities and, more recently, the backlash against the efforts being made.
It's not entirely surprising. Many of those efforts have been fragmented and designed to fix an immediate problem without considering the system as a whole. Others fail to connect intentions and ideas to actionable, strategic plans. You can't just add a 'B' for Belonging at the end of DEI and expect that to be an outcome.
What does work? I've learned from helping clients across various industries and various stages that the 'E' and the 'S' — Equity and Social Impact — and the integration of these efforts are the keys to meaningful and self-sustaining change. I'm sharing how I came to that conclusion, and more importantly, the specific way I approach solutions for these elements, because I don't want more companies giving up in the face of wasted investment and pushback. As McKinsey puts it, “the case for holistic impact” is stronger than ever. And backlash isn't a problem if equity is properly addressed.
Fixing Problems vs. Solving at the System Level
While establishing Deloitte Canada’s National DEI consulting practice, as well as in my role as the first Global DEI Leader at Deloitte, I guided numerous organizations and leaders through fixing inequities, from power imbalances to pay gaps, from lack of representation in leadership to low metrics of inclusion.
But fixing problems is akin to putting a bucket under a leaky pipe: it only bought time. And finding better, more sophisticated approaches still led me to the same conclusion. I could be endlessly diagnosing and treating symptoms, avoiding their inevitably damaging consequences — or I could figure out what was causing them in the first place.
A new purpose for my passion became clear. I was determined to not only solve for but prevent inequities in the workplace. To understand the system and address the root causes I would have to intervene earlier in a company’s lifecycle and build equity right into how a company does business — through talent and operations — before a fix is needed.
Recently I had a client determined to increase diversity in their Leadership team, but instead of leading to positive results, it led to internal pushback and didn’t work. Why? Because they were trying to fix a symptom, rather than solve the issue that was causing it. Tactically, they were challenged by the lack of diversity among their applicants, so, along with many other companies I’ve seen in this position, they applied more pressure to the system, demanding that their team fill the next new role with a woman. This kind of action may seem right on the surface since we are aligned on the outcome, but how you get there is not fair, equal, nor just — and is exactly the kind of process that leads to backlash. What they needed was to solve the issue causing the result. I guided them through the process of attracting, sourcing, and interviewing diverse candidates, and learning from new efforts.
Understanding the Link Between Equity and Social Impact
In the context of DEI, equity represents the policies and practices that enable everyone in your organization to thrive. This internal equity is an essential component under the umbrella of ESG, but your social impact doesn’t end at your door. You also need to consider external stakeholders: how you show up for the customers that you serve, and the broader community that you operate within.
Inside and outside your business, are you reinforcing barriers, or breaking them down? Who are you lifting up and who are you excluding?
For most organizations, these aren’t simple questions to answer.
Unlike diversity (a head count) and inclusion (a feeling of belonging, value, and respect), equity offers the most leeway for subjective thoughts and behavior, leading to the highest potential for individual bias. Information, education, personal network, opportunities, definitions of success, and more, all feed into our perception of a fair and just system — and that perception is either reinforced or dismantled by the policies and practices in place.
How to Build a System that Solves its Own Problems
If you believe you can hire more diverse people to address your company’s DEI gaps or stick a logo on the right charity to meet your ESG goals, you’re going to miss the mark, inside and outside.
And ignoring how the “E” and the “S” interact with each other can introduce a third level of risk — consider how many companies have been called out for mistreating their employees while maintaining excellent customer service, or vice versa. A siloed approach can damage your brand, create resentment among stakeholders, and torpedo performance.
I know from experience that no singular effort will solve inequity. Rerouting individual behaviors and redesigning a system requires a strategic concert of initiatives and a thoughtful implementation plan.
What works:
Integrating the inside and the outside: bridging equity and social impact together, so systems reinforce and strengthen each other.
Delivering what is needed, when it counts: offering a strategic roadmap, to maximize effectiveness and efficiency.
Redefining ‘optimal’ results: making the human experience a part of business strategy, to not only prevent problems but also unlock benefits.
The CLCo approach does just that. We take out the guesswork, guide you clear of missteps and wasted efforts, and create lasting change by solving the root issues. With every solution, we integrate equity and social impact by design.
Want to learn more about how we tackle inequity before it becomes a problem?
